EMC Corp, the top maker of corporate data storage equipment, forecast full-year revenue above Wall Street expectations as corporate technology budgets stabilized, sending its shares up 2.4 percent in premarket trading.
The company also reported stronger-than-expected quarterly earnings on Thursday, citing its own efforts to cut costs, in addition to the downturn in spending hitting bottom.
"Things are stabilizing. Visibility is getting better. That's what Intel, IBM, Dell, everybody else is saying," said Kaushik Roy, an analyst with Wedbush Morgan Securities.rts to cut costs, in addition to the downturn in spending hitting bottom.
EMC said profit excluding items was 18 cents per share in the second quarter, above the average analyst forecast of 16 cents, according to Reuters Estimates. Revenue fell 11 percent to $3.26 billion, beating the $3.20 billion average forecast of analysts.
"While global conditions remain challenging and our full-year view of declining IT spending remains unchanged, EMC's second-quarter financial performance reflects customers' budget stabilization and improved business predictability," Chief Financial Officer David Goulden said in a statement.
EMC forecast it would report full-year revenue of $13.6 billion, excluding $200 million from its pending acquisition of specialty storage company Data Domain Inc. Analysts had expected annual revenue of $13.5 billion.
Net income fell to $205.2 million, or 10 cents per share, from $360.1 million, or 17 cents, a year earlier.
As of the time of writing this, EMC shares are up about 5% in the pre-market. They didn't say anything earth shattering, but like I said, I believe the market is depending on large cap tech to lead us. I do like this company moving forward. Also a couple of hedge fund managers I admire, Bill Ackman and David Einhorn, own large stakes in EMC.